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Thomas Coughlin, Ex-Wal-Mart Official
Gets 27 Months Home Confinement and
5 Years Probation for
Stealing from Wal-Mart

AP 11aug2006

 

Coughlin was hired by Wal-Mart in 1978 as director of loss prevention. Meanwhile in another state, an $11 theft of wine, lip balm and breath freshener gets 25 Years to Life in Prison for Ronald Herrera.

More on
Coughlin
and Wal-Mart

If you worked for Wal-Mart at any time since December 26, 1998, you may have legal claims in a class action sex discrimination lawsuit against Wal-Mart.

Si Ud. desea información en Español sobre esta demanda de la acción de clase contra Wal-Mart, por favor llámenos al (800) 839-4372.

FORT SMITH, Ark. — A former No. 2 executive at Wal-Mart Stores Inc., Thomas Coughlin, was sentenced to 27 months of home confinement and five years' probation for stealing money, merchandise and gift cards from the retailer. His sentence also included a $50,000 fine and $400,000 in restitution.

The 57-year-old Mr. Coughlin, a protégé of late Wal-Mart founder Sam Walton, faced a maximum of 28 years in prison after pleading guilty to five counts of wire fraud and one count of filing a false tax return. He also could have been fined as much $1.4 million.

Prosecutors had asked for Mr. Coughlin to serve six months to a year in prison, but U.S. District Judge Robert Dawson agreed with a doctor who testified that Mr. Coughlin's health was too poor for the former Wal-Mart executive to enter prison.

In court in January, Mr. Coughlin specifically admitted defrauding the world's largest retailer to pay for the care of his hunting dogs, lease a private hunting area, upgrade his pickup truck, buy liquor and a cooler, and receive $3,100 in cash. The items were worth a minuscule amount when compared to his $1 million-plus salary.

Wal-Mart, of Bentonville, Ark., referred Mr. Coughlin to federal prosecutors after alleging he took money, goods and gift cards valued at up to $500,000 over a period of at least seven years before he retired in early 2005.

Wal-Mart made further allegations of embezzlement and theft in a separate civil lawsuit it filed last year seeking to revoke Mr. Coughlin's multimillion-dollar retirement package. That suit alleges that Mr. Coughlin used tricks including false expense reports to buy things as varied as snakeskin boots, hunting trips and Bloody Mary mix.

However, that lawsuit was dismissed by an Arkansas judge who said both sides had signed a pledge as part of Mr. Coughlin's retirement deal not to pursue any claims against each other for any reasons. Wal-Mart has appealed the dismissal of its lawsuit to the Arkansas Supreme Court.

No mention was made in Mr. Coughlin's public filings with the court of his earlier claim that he used money obtained from Wal-Mart to pay for anti-union activism. Wal-Mart has said there was no such project.

Mr. Coughlin retired as Wal-Mart vice chairman in January 2005 and gave up his spot on the company board in March 2005 after Wal-Mart referred him to prosecutors. The matter was taken up by a grand jury in Fort Smith, Ark. As vice chairman, he received a base salary of $1.03 million in his final year with the company. He received more than $3 million in bonuses and other income in the same period and held about $20 million in Wal-Mart stock, according to Securities and Exchange Commission filings.

Ann Zimmerman contributed to this article.


Ex-Wal-Mart Exec Gets Home Confinement

Reuters 11aug2006

Coughlin admitted to stealing thousands of dollars from the company

 

FORT SMITH, Ark. - Tom Coughlin, the former Wal-Mart Stores Inc. vice chairman who admitted to stealing thousands of dollars from the company, was sentenced Friday to 27 months of home confinement.

Coughlin, who joined Wal-Mart in 1978 and worked closely with legendary founder Sam Walton, had faced up to 28 years in prison and $1.35 million in fines after he pleaded guilty in January to wire fraud and tax evasion.

"There is no excuse for my conduct," Coughlin said at the hearing in U.S. District Court in Fort Smith, Arkansas. "I feel compelled to apologize to my extended Wal-Mart family."

Coughlin said he would spend the rest of his life trying to undo the damage he had caused.

His doctor, Joel Carver, had testified earlier Friday that the 57-year-old was too "fragile" for prison, suffering from diabetes, cardiac disease, sleep apnea, arterial blockage, and other ailments. Coughlin was treated for arterial blockage in 2003 after falling ill while working out in a gym.

Prosecutors countered that prisons had good medical facilities available to care for him, but Judge Robert Dawson decided on home confinement, five years of probation, and restitution of about $411,000.

Roughly three quarters of that sum will go to Wal-Mart, and the remainder to the Internal Revenue Service.

A Wal-Mart spokesman was not immediately able to comment.

Wal-Mart had accused Coughlin of misappropriating as much as $500,000 through misuse of gift cards and bogus invoices, and said he used the money to buy an odd assortment of items including customized dog kennels and a Celine Dion CD.

Coughlin pleaded guilty to a smaller sum that included $6,500 for his share of a private hunting lease, $2,695 for upgrades to his 1999 Ford truck, and a $200 Sam's Club gift card that he used to buy a cooler, two cases of Miller Light beer and other items.

Judge Dawson recommended that Coughlin begin his home confinement within 60 days, and pay the restitution within 30 days.

Coughlin retired from Wal-Mart in January 2005, but remained on the board of directors until his resignation two months later following an internal investigation into the improper use of gift cards and expenses.

source: http://msnbc.msn.com/id/14306445/ 11aug2006


Wal-Mart Ex-Vice Chairman Coughlin Gets 27 Months House Arrest

JENNIFER BOULDEN & BOB van VORIS / Bloomberg News 11aug2006

 

Thomas M. Coughlin, the former vice chairman at Wal-Mart Stores Inc., was sentenced to 27 months home detention today after admitting he falsified expense reports to buy liquor, care for his hunting dogs and upgrade his truck.

Wal-Mart, the world's biggest retailer, accused Coughlin, 57, of wrongly claiming reimbursement for hundreds of thousands of dollars worth of items including hunting gear, dog food, underwear, beef jerky and a stuffed wild boar. Coughlin was head of theft prevention when he joined the company in 1978.

In January, Coughlin pleaded guilty to five counts of wire fraud and a single count of failing to report income from the fraud on his 2000 federal tax return. At the time of Coughlin's guilty plea, Wal-Mart called the case ``embarrassing and painful.''

He was sentenced in a hearing today before U.S. District Judge Robert T. Dawson in Fort Smith, Arkansas.

Coughlin, a friend of the late Wal-Mart founder Sam Walton, was the retailer's second-ranking executive before he retired in January 2005. Coughlin's salary and bonus amounted to $3.9 million in 2005 and 2004, $3.2 million in 2003 and $1.8 million in 2002, according to Bloomberg data.

Prosecutors said Coughlin committed his thefts with the help of Robert E. Hey Jr., Wal-Mart's director of operations development. Hey pleaded guilty to three counts of wire fraud in November and was sentenced to six months probation and a $3,300 fine. As part of a plea agreement, Hey was required to cooperate with the government's case against Coughlin.

Contact Lenses

Coughlin began in 1996 to order subordinates at Bentonville, Arkansas-based Wal-Mart to help him falsely claim reimbursement for expenses and obtain company gift cards, prosecutors said. In February 2005, a Wal-Mart employee noticed that Coughlin used a gift card to buy contact lenses, sparking an internal probe.

Coughlin admitted using a stolen gift card in a Joplin, Missouri Sam's Club to buy a cooler, two cases of Miller beer, two cases of Smirnoff vodka, a container each of Jack Daniels and Crown Royal whisky, a carton of Patron tequila, and a patio torch.

Coughlin was forced to resign from Wal-Mart's board in March 2005.

In his guilty plea, Coughlin admitted to five thefts of cash and Wal-Mart shopping cards amounting to $14,395. The tax evasion count said Coughlin's actual taxable income in 2000 was ``substantially in excess'' of a reported $1.7 million.

Joel Carver, Coughlin's doctor, said his patient has severe pulmonary hypertension, diabetes, sleep apnea and a severe heart problem that would make it dangerous for him to serve a prison sentence. ``He is very fragile,'' said Carver. ``He's 57 going on 87.''

Coughlin at one time claimed he took the money as reimbursement for funding a secret anti-union program at Wal- Mart. The company, which has battled unionization throughout the U.S., denied the claim.

The case is U.S. v. Coughlin, 06-CR-20005-001, U.S. District Court, Western District of Arkansas (Fort Smith).

source: http://www.bloomberg.com/apps/news?pid=20601087&sid=aLKzGkSrUrZI&refer=home 11aug2006

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